‘I studied at uni, now sell eggs’: India’s job crisis under Modi

Editor | February 6, 2019 | Middle East | No Comments

New Delhi, India – A grim-faced young man rustles up a quick egg snack on a pushcart at a quiet residential corner in a suburb of the Indian capital, New Delhi, as he meticulously enquires about his patrons’ tastes.

Sagar Kumar, a 21-year-old undergraduate in commerce at an open university in Noida, a city adjacent to the national capital in Uttar Pradesh – the country’s most populous state in the Hindi-speaking heartland – is angry.

He has been working as a roadside food vendor for a year to pay for the school fees of his younger siblings and the kidney dialysis of an ailing father. He is impatient for a government job.

“I study at night, the rest of the time I tend to this food cart and earn 500 rupees [$7] a day. What use is a commerce graduate degree to sell eggs by the roadside?” Sagar said.

In New Delhi’s Tughlakabad slums, around the remnants of a medieval era fort, 24-year-old Seema is a part-time cook, but hopes to get a job as an office secretary.

“My typing speed is very good and I can add numbers. My family came to Delhi from Badayun [in Uttar Pradesh] where I wanted to get a clerical job at a government office. But I have had no luck yet. There are also safety concerns to consider when looking for a job as a woman here,” she said.

What use is a commerce graduate degree to sell eggs by the roadside?

Sagar Kumar, Food vendor

Survey barred from publishing

India’s fast-paced economic growth has failed to generate employment opportunities for over 12 million Indians who enter the job market every year.

Prime Minister Narendra Modi, who swept to power in 2014 on the promise to create 10 million jobs annually, has been accused of creating the worst unemployment crisis in decades.

A leaked report about India’s joblessness last week revealed that unemployment rate rose to its highest level in at least 45 years.

For the first time, half of India’s working-age population (15 years and above), is not contributing to any economic activity, data analysis by the National Sample Survey Office (NSSO) shows.

Officials at Niti Aayog, the premier government policy think-tank, said the report was not final and that sufficient jobs were being created.

Former Finance Minister Arun Jaitley dismissed the survey findings, saying it was “disinformation”.

“If the economy is growing at 12 percent nominal growth for the last five years, it would be an economic absurdity to say that such a large economic growth, the highest in the world, doesn’t lead to the creation of jobs,” Jaitley told Indian news agency ANI.

“If no job creation takes place then there is social unrest. This has been a peace period where no major social agitation has been witnessed in the last five years,” Jaitley, now a minister without portfolio, claimed.

‘We need jobs’

But warnings about a brewing jobs crisis are not new. In December, the Centre for Monitoring Indian Economy (CMIE) said labour participation rate, a measure of adults who are willing to work, has fallen to 42 percent.

In March 2018, data from the CMIE, a portal that tracks economic activity, said 31 million Indians were looking for jobs.

A report released last month by the All India Manufacturers’ Organisation said 3.5 million jobs had been lost since 2016, when Modi banned about 85 percent of currency notes.

Government jobs in India are the most sought after. India’s railway network recently received 19 million applications for 63,000 jobs as cleaners and track maintainers.

Sagar, son of a migrant family from Madhepura in Bihar state, says he applied for several government jobs, including at the railways which does not mandate a college degree.

Old enough to vote for the first time, he says “whoever forms the next government must help us”.

Sagar says neither jobs are available nor is it easy to get bank loans to start a small business [Zeenat Saberin/Al Jazeera]

“We need jobs. If you can’t do that, then help us earn. I tried to get a loan for entrepreneurs, but that is a nightmare as well. So there is nowhere to turn. Neither jobs are available nor is it easy to get bank loans to fund a small business,” he added.

Sagar is among the 133 million young adults who will cast their ballots when the world’s biggest democracy holds a general election due in less than 100 days.

The election comes as India struggles through a period of what economists call “jobless growth”.

“The jobs crisis is really bad. The medium and small scale industries and agriculture are major employers in our country. These sectors have suffered due to policy-induced shocks like a badly-implemented national services tax GST and a note ban in 2016 that broke the backs of small businesses and the informal sector,” economist Prasenjit Bose told Al Jazeera.

The fact is that the economic growth data is being grossly overestimated.

Prasenjit Bose, economist

“Even the organised sector has not grown under this government. Although public sector investments have happened, that has not translated into jobs,” he said.

“The fact is that the economic growth data is being grossly overestimated. There can be no other explanation for this discrepancy between an over 7 percent GDP growth and a 45-year-high unemployment rate.”

Unemployment fuels inequality

Job growth has slowed just as the biggest youth bulge the world has ever seen nears its peak in a country where more than half of its 1.3 billion people are under 25.

In cases like Sagar and Seema, a precarious labour market, socioeconomic factors and a lack of public services have made matters worse.

Since the lack of access to income is the main driver of poverty, experts warn this will also fuel an increase in inequality.

With faster but uneven economic growth in recent decades, boundaries between villages and small towns have blurred. Meanwhile, migration, mobile phones and television have ensured people are more keenly aware of how the lives of others are improving faster than their own.

In states like Maharashtra, Gujarat, Haryana and Rajasthan, upper caste land-owning farming communities have held large protests in recent years, demanding quotas in government jobs.

Under pressure to placate the unemployed youth, the government passed a law last month offering quotas to the upper castes in public sector jobs and higher education places.

The population is rising beyond the economy’s capacity to create jobs and there is insufficient job creation in the private sector, say experts.

Investment in the Indian economy is stagnating at lower levels than 2011-12 and the unorganised sector is declining, said Professor Arun Kumar, author of “Demonetisation and the Black Economy”.

“The government needs to address the agricultural crisis. The unorganised sector needs a boost, you need to give them credit and support. The unorganised sector, when revived, will create demand for its own self,” Kumar told Al Jazeera.

India is characterised more by underemployment than unemployment.

Arun Kumar, economist

In the midst of the squabbling over jobs data, economist Kumar says it is necessary to point out the distinction between unemployment and underemployment.

“In India, we don’t have social security. So if somebody loses work, they can’t say we won’t work. Everybody does some work here, so you see graduates pushing a cart, etc. India is characterised more by underemployment than unemployment. The problem is our unorganised sector employs 93 percent of those seeking work. It is this 93 percent that is losing jobs because this sector is in crisis,” Kumar said.

Major election issue

This is why India’s ruling Bharatiya Janata Party (BJP) looks nervous as it seeks re-election.

In a television interview last year, Prime Minister Modi had said that selling ‘pakodas’ (deep-fried finger food) is also a form of employment since the ‘pakoda’ seller would earn 200 rupees ($2.8) a day.

The remark created a huge controversy, with the opposition accusing Modi of being insensitive to people’s demands for jobs. Ahead of polls, it has ratcheted up pressure on Modi over his unkept promises on jobs.

The main opposition Congress party has promised to introduce a minimum income guarantee for the poor if it wins the elections, due by May.

India’s fractured political landscape, with its dozens of regional parties and caste alliances, poses a serious challenge to Modi’s re-election bid.

In spite of people like Sagar and Seema’s economic aspirations, regional and caste politics will play a big part in how people vote. And it will be an uphill task for the next government, irrespective of its ideological affiliation, to create all the jobs needed.